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Investigations

Pennsylvania DBE Suspended from Federally Funded Contracts

On December 12, 2014, the Federal Highway Administration suspended Watson Maloy, President, WMCC Incorporated (WMCC), and WMCC, pending debarment, for their role in a Disadvantaged Business Enterprise (DBE) fraud scheme.

In November 2014, Maloy pleaded guilty in U.S. District Court, Pittsburgh, Pennsylvania, and admitted that in 2012 and 2013, he and co-conspirators employed by Century Steel Erectors Co. LP (CSE), agreed to use WMCC as a front company to obtain profits from DBE contracts. CSE staff actually found, negotiated, coordinated, performed, managed, and supervised the DBE subcontracts. Maloy's firm failed to perform a commercially useful function and CSE actually completed all DBE work including negotiating, crane rentals, ordering supplies and materials, and recruiting union workers.

To conceal the scheme, Maloy admitted that CSE officials used WMCC letterhead and email accounts when communicating with general contractors and Pennsylvania Department of Transportation officials. CSE personnel possessed WMCC business cards, t-shirts, and hard hats, as well as magnetic WMCC placards to conceal CSE logos on construction vehicles.

Maloy received a fee for his participation in the scheme, which resulted in approximately $1.8 million in illicit proceeds.

We are conducting this investigation with the Federal Bureau of Investigation and the Pennsylvania Turnpike Commission - Office of Inspector General.

Note: Exclusion actions (suspensions and debarments) are frequently for a specific period of time and the System for Award Management "Sam.gov" should be consulted to find whether a company is currently excluded.